To buy Ant is to buy the China of tomorrow!

On July 20, the Ant Financial Group announced that it is preparing its simultaneous IPO on the two financial markets of Shanghai and Hong Kong. The company is aiming at a valuation of 200 billion dollars. Jack Ma, the founder of the Alibaba Group, established the company in 2014. It focuses on five activities: finance, technology, financing, insurance, and credit.

ant group IPO 蚂蚁金服

Alipay, the front door

The online payment application, Alipay, is the gateway to its services. While Paypal has 300 million users, its Chinese competitor has 900 million people in China and 400 million abroad. Paypal has a capitalization of about $200 billion, Visa, and Mastercard more than 300.
As for financial services, the group has 740 million customers and can count on 28 million micro-enterprises. 80% of Alipay users use three other Ant services, and 40% use five services. An advantage for American companies, for the moment, the Western consumer remains more profitable than the Chinese consumer.


Alipay-We Chat

Alipay’s competitor on the Chinese market is We Chat’s wallet, which has a 30% market share in online payment. We Chat cannot make the comparison in terms of amounts as they are much lower. On offline commerce, We Chat has a higher market share with a 7:3 ratio in its favor.

Synergy with Alibaba

Alipay also benefits from all the services offered by the Alibaba group with the sale of cinema tickets, travel agency, home delivery. It intends to develop medical advice services. Both companies have invested heavily in development while collaborating with partners for the development of small applications. We Chat works with 1.5 million developers, and Alipay has set up a billion yuan fund for developers.

From finance to technology

The most profitable sector is the financial services sector, particularly with the loan. Economist Huang Qifan, former mayor of Chongqing, estimated that in 2019, Ant had a profit of 10 billion yuan, 45% of which came from two Chongqing companies specializing in “small loans” to SMEs – 36,000 yuan average. The IPO file has not yet been released, but it is believed that Ant granted 1700 billion yuan of credit in 2019, +72% compared to 2018.
The insurance sector has very important potential. Ant recorded 240 million yuan in this segment in 2019; the billion should be exceeded this year.
Ant wants to put more emphasis on technology services than on finance. Instead of Fintech in Hangzhou, we talk about Techfin. Five areas are at the heart of the research: the blockchain, artificial intelligence, security, the Internet of objects, and information.
In June 2020, the group changed its name, removing “financial services 金融服务” for “technology 科技”, and “Zhejiang 浙江” its province of origin, to highlight its core business, technology, on the one hand, and on the other hand remove the local connotation and display its global ambition.


Internationalization is an important pole; in 2018, Ant raised 14 billion dollars for international development. The objective for 2025 is to have 2 billion customers, 50% abroad. Currently, out of 1.3 billion users, 30% are outside China.
In recent years, Ant has acquired a number of companies or created alliances. In Asia, development is going rather well.
In India, in February 2015, Ant entered the capital of Paytm as a strategic investor to form the first local player in online payment. He sent 100 technicians to Delhi to share his expertise. In two years, the figures have skyrocketed, the alliance’s transactions have increased tenfold with 200 million users, including 90 million assets. By the end of 2019, the number had risen to 300 million. We’re not talking about profitability, but cash burn. Paytm posted a net loss of 500 million dollars. The Indian government, following tensions with its neighbor, in the interests of national security, banned the use of 59 Chinese applications, including We Chat and Tik Tok. On the other hand, Ali Pay and Paytm was spared. In other Asian countries and territories, such as Thailand, Pakistan, South Korea, Malaysia, and Hong Kong, the strategy remains the same: to ally, with minority stakes, with a local leader that has good Internet coverage and a vast network of users.

The United Kingdom, no United States

In the United States, the adventure did not enjoy the same success. The US government vetoed the takeover of Money Gram in 2018 for security reasons. The group led by Jack Ma fell back on the British WordFirst on February 14, 2019, with a sum of 700 million dollars. At the same time, the latter put an end to these operations on American soil. In order to avoid a blockage of the takeover by the American authorities, who takes a dim view of the data of American citizens in the hands of a Chinese company? Alipay has already made numerous agreements with most European countries.

The regulatory authorities

The regulatory authorities in several countries do not always view the establishment of the Chinese giant favorably, while the Chinese administration is keeping a close eye on developments; the Caixin site believes that it presents a real challenge. The banking sector complained that Alipay was operating in some aspects like a bank without the constraints and security obligations of a bank. By 2014, the Chinese Central Bank had already temporarily halted Alipay’s transactions. In the first quarter of 2018, the amount of money available in customers’ accounts amounted to 1690 billion yuan. The regulatory commission has banned companies from using these funds for their own benefit, a common practice in the industry. It enjoined them to deposit them as a reserve on the Central Bank accounts, without any interest. An investigation could be launched by the anti-monopoly committee into Ant and Tencent, the owner of We Chat. The two online payment giants carry out nearly 95% of the country’s online transactions.

Political support

There are many questions about how much support Jack Ma needs to “get permission” to go that high and challenge the banks on their turf. Is he part of a club of high-flying businessmen who have the support of the (declining) Shanghai group that the current president has been fighting since he came to power? It is normal for China’s big bosses to deal with politics and to comply with “patriotic demands” if they want to be able to continue to develop their society (see article).

To buy Ant is to buy the China of tomorrow!

Alipay makes money on volume, but the challenge for the group is to transform a low-margin service into a high-margin technology services company. The Alibaba Group has contributed to the profound changes in China’s society and trade over the last two decades; Ant could bring about other profound transformations. Buying Ant shares means buying the China of tomorrow!
The service sector generates nearly 60% of China’s GDP, but it is in need of major modernization and will the digitalization give another face to China? Without a doubt!

Sources :
Article by Caixin

Topics to be consulted :



4 August 2020

Where 青 is from ?

A reader asked me about 青, which is present in many characters. Various explanations are circulating about its origin. One seems to be quite interesting.

Some characters with spelling close to 月, like 舟 and 丹, have disappeared from some character structures to become 月. A desire for aesthetics or fluidity with the brush has brought about these changes.

It is necessary to look at 丹,dān, red, vermilion, cinnabar.
A first shows shows a frame in which ore was put to heat it and “dye” it in vermilion. The ancients believed that they could achieve immortality with this stone.

青, qīng, blue or green, young.

The top of the ancient writing represents growing herbs:
Underneath, 丹 takes the handwriting from 月. It is the frame in which the herbs are dyed green (colour of the herbs). By extension, the idea of lush and young.

In the next articles, we will explore the compositions, such as 情, 晴,请, 淸, 精, 静, 睛, 婧.

Articles on characters classified by radical :

Radical arrow 矢

Radical child 子

Radical eye 目

Radical heart 心

Radical illness 疒

Radical 巳

2 August 2020

Hands + writing + character = ?

Children’s serie, xué, 学-學, study, learn.

A first spelling showed two hands drawing/writing and underneath a room :

Chinese character.

Former meaning: school. The idea is logical :

A later spelling added the child, which remained. The meaning became more precise: a child practicing drawing/writing characters.

étudier en chinois

The simplified form used today in mainland China has retained only part of the top. The simplified character is on the left, the traditional on the right:


Articles on characters categorized by radical:

Radical arrow 矢

Radical child 子

Radical eye 目

Radical heart 心

Radical illness 疒

Radical 巳

2 August 2020

China: The foreign touch is losing ground?

An article by economist Wu Xiaobo sums up in just a few sentences the changing psychology of Chinese consumers and brand owners concerning the foreign countries. The international touch made it possible to move upscale when you could afford it. Now, the China touch is gaining ground.

Abroad = high-end

Forty years ago, when a Chinese consumer was asked whether he wanted to buy Chinese or foreign products, he replied: “Chinese products.” His answer was not motivated by the quality of local products, but by their affordability. When the wallet had the right thickness, consumers preferred foreign products.
The foreign item was synonymous with high quality. Many Chinese brands added in the brand name, the product design, and an international shade to make it foreign. There is a famous furniture dealer Da Vinci and a ready-to-wear brand La Chapelle, and many others who registered their brand abroad to claim to be a foreign brand.

Towards Chinese culture

Today, we are witnessing a turnaround; some brands are getting rid of the foreign connotation to highlight Chinese culture. Li Ning has taken this path, even for its international development. In China, consumers approve of this approach. There is an awakening of the local culture. There are more and more young people wearing Chinese clothes on the streets, and Li Ziqi has become a calling card for exporting Chinese culture abroad; the Forbidden City’s intellectual property has been an enormous success, bringing in $1.5 billion in revenue in 2017 from the purchase of peripheral products; international groups have begun to pay attention to the cultural needs of Chinese consumers, developing co-branded products with elements of “national trend.” McDonald’s changed its Chinese name. It evolved from Maidanglao 麦当劳 with a pronunciation that was somewhat reminiscent of the American name to a resplendent name, Golden Ark 金拱门.

liziqi 李子柒 Chinese soft power
The famous Li Ziqi 李子柒

Confidence in Chinese culture

Wu Xiaobo explains in conclusion: People choose Chinese brands even with a higher standard of living. Perhaps the main reason is not the low price, Chinese brands understand local consumers better; they have more confidence in their own culture.
Indeed, as Wu says, “Chinese brands understand local consumers better.” I’m not sure that “greater confidence” in Chinese culture is a greater incentive to buy a local brand. The chemistry is more subtle: a mix of nationalist politics, international tensions, a marketing strategy that flatters the national ego in the face of the country’s renaissance, and many other factors explain this return (to be confirmed) to national brands. The economist’s remarks are pertinent, but I find the conclusions a bit hasty. They seem to come straight from official bodies with little objectivity.
Foreign brands that want to conquer the Chinese market must adapt and show their desire to understand Chinese consumers. Some of them have understood it; others realized it far too late and went home quickly.

Source :
Wu Xiaobo’s Weibo Account

1rst of August

Roof + child = ?

The origin of 字, zì, character, has several versions.
One sees the roof under which the child is born because one of the first senses is “born”.

Another explanation: the Elders believed that children should learn the characters “inside”. Older people have more difficulty. As early as Zhou 1100- 256 BCE, upper-class children entered school at the age of eight.

The choice is yours!

Article on character, sorted by radical:
Radical arrow 矢

Radical child 子

Radical eye 目

Radical heart 心

Radical illness 疒

Radical 巳

1rst of August


The research bureau Trigger Trend analyses data on GDP per city in the first half of 2020. Out of the twenty largest cities (except Wuhan and Qingdao), eleven have recorded an increase, including Shenzhen, Chongqing, Suzhou, and Chengdu. In contrast, cities such as Beijing, Shanghai, and Guangzhou have a decrease. Wuhan, with the impact of COVID, recorded the biggest fall, estimated at 20%. Chongqing is ahead of Guangzhou, but we have to look at the numbers in detail.

Ranking of Chinese cities by GDP in the first half of 2020:

Chongqing in front of Canton

In the first quarter, Canton had a higher GDP of 24 billion yuan. In the end, Chongqing enjoyed an advance of 24.154 billion over the first six months, with 1120.983 billion GDP and a slight increase of 0.8% against 1096.829 billion and a decline of 2.7%.


The export sector is suffering much from the health crisis, especially the textile branch, which could not fully benefit from the high season of March-May. The Guangzhou-Foshan region has been hit hard by the effects of the pandemic both abroad and in China. Initially, factories could not resume production fully, as workers could not always return to the factories after the Chinese New Year. As the pandemic spread internationally, customers reduced orders.
As shown in the table below, retail sales, import-export, and investment were more resilient in Chongqing.

Although Chongqing has gained the upper hand in the first part of 2020, Guangzhou has built up many strengths so that the two cities are not comparable since the beginning of the reform policy.


GDP per capita and disposable income are more than twice as high in Guangzhou and urbanization is more advanced. Chongqing has not been part of Sichuan province since the 1990s and depends directly on the central government. This “city-province”, which has an area close to that of Austria, is ten times larger than Guangzhou. The strategy is to make it a significant pole of China’s development from the interior. The 2000s saw robust growth with peaks in 2007 (+23.9%) and 2011 (+26.32%).

Is Chongqing losing importance?

The city may be weakening its position as a central hub in favour of Chengdu. Indeed, river transport is losing ground to air transport, Chongqing can no longer exploit its fundamental role in its domain. Moreover, for new technology products, the cost of transportation is not a determining factor.

For its part, Canton has already successfully begun its shift towards new technologies, which already generate a quarter of the local GDP. The downward trend is not expected to continue, the decline is undoubtedly cyclical. Chongqing benefits from its size effect, but the city is still far behind in terms of income and average per capita GDP.

Articles on the export sector in China :

Export rebound? Yes, but!

Export Reconversion

China-India, where to go?


1rst August 2020

Where are China’s universities concentrated?

The entrance exam for Universities – the famous Gaokao 高考, took place on July 7 and 8. 10.71 million students participated in the exam, 400,000 more than last year. The marks were published last weekend. Universities now choose future students based on their results and individual wishes. Where do these students go?

The Yangtze Delta

The Lianjia real estate agency network 链家 (6000 offices) details the observations of a study on universities. It shows that in 2018 three regions will stand out: the Yangtze Delta (Shanghai and the nearby provinces of Zhejiang, Jiangsu, and Anhui) with 458 establishments, 17% of the total in China, the Beijing-Tianjin-Hebei area as a whole 270, 10% and the Great Guangdong Bay region 181, 7%.
The first region has 5.08 million students, the second 3 million and the third 2.38 million. There is a Matthew effect; the universities tend to maintain their dominance. The less prestigious organizations lower tuition fees and offer stipends, but they cannot compete with their more prestigious competitors.

Jiangsu ahead

Among the provinces, Jiangsu, near Shanghai, is the province with the most universities (167), ahead of Guangdong (154) and Shandong (146).

Beijing, the first city

For cities, Beijing is first with Universities, ahead of Wuhan, 83, and Canton, 82. Shenzhen is in 40th place. Wuhan is ahead of Canton, Chongqing ahead of Shanghai. Students do not always work at their place of study; instead, they follow the economy’s movements. Just over 50% of the students graduating in 2019 from Qinghua University in Beijing work in the capital. For Shenzhen, the national Silicon Valley, which attracts many graduates, one expression sums up its situation well: “Shenzhen doesn’t train talent, it’s the work of other cities. »

The distribution of universities corresponds more to a historical legacy than to recent developments in the country. For example, the famous Northeastern institutes specializing in geology no longer meet the needs of the economy; they are less attractive.

Related articles :
Which cities attract the most people to China?

Which Chinese provinces are the most attractive?

Source: Article by Lianjia

31 July 2020

Field + heart = thinking. Weird?

The character 思 sī, to think, is formed by, 心 xīn, heart and 田 tián, field. Bizarre? Yes and no. For aesthetic reasons or convenience or for fluidity in writing with the brush, some characters have lost a line, a dot, or have even given way to others. Let’s go back to the origin of 思 :to think in chinese

An ancient writing includes the heart at the bottom and the brain: . The brain handles reason, and the heart controls feelings. 囟 xìn has a sense of fontanelle. It has lost its place over the centuries to 田, which is simpler to write.

Articles on Chinese characters, by radical :

Radical arrow 矢

Radical child 子

Radical eye 目

Radical illness 疒

Radical 巳

29 July 2020

Economic recovery or not?

La vie en rose

Talking about China, especially about its economic health and political system, can sometimes be a joke when you don’t want to look in the mirror. Of course, looking at this country when you live in it or when you are outside, it gives you different views. However, we must not be fooled by the various forms of the numbing of the brain. In China, the economy’s dynamism, population, and optimism – well nurtured by harmonious official media – can lead us into a bubble. When one has interests, financial, family, economic, or otherwise, one is even more exposed to the risk of turning into a conscious or unconscious parrot of the Xinhua News Agency with a fanaticism appreciated by the most nationalistic fringes and which makes others laugh.

Black is black

On the other hand, outside China, where trains are not on time, far from the beautiful window, it is easy to fall into another bias. With the darkness that we like to crush in Western countries, we quickly see a China that has been in fall for decades. This kind of event also happens to Chinese people who seem to discover their country by listening to Chinese media based abroad. One kept telling me that you have to go to New York to find out what goes on behind the Chinese government’s scenes.
You add cream of ideological, left-wing or right-wing reading grid, and intellectual comedy can be in full swing, or rather it’s the burial of discernment. I don’t want to teach anyone a lesson, because we can all go through these states, me first, and sway from one to the other. This is why, on this site, I bring back voices from the various camps. Today, I am talking about Wang Jian’s program on China’s economic health. After having worked in China and Hong Kong, this financial journalist now lives in the United States where he can express himself more openly and his song is not from Beijing. Let’s first take a look at the official figures released last weekend.

Chinese consumption in the first half of the year: -5,9%

The National Statistical Office published consumption figures in the first half of the year. They amounted to 9,718 yuan per person and showed a decline of 5.9% (9.3% removing the price factor). Urban residents spent an average of 12,485 yuan (-8%, -11.2% adjusted) and rural residents spent an average of 6209 yuan (-1.6%, -6%).
Two categories of products showed an increase, one food-alcohol, tobacco with + 5% and the other housing + 3.1%. Clothing decreased by 16.4%, household goods by 6.4%, telecommunications by 10.7%, education and recreation by 35.7%, and welfare and medical expenses by 9.9%.

Consumption, expenditure by category, and proportion in overall consumption in the first half of 2020:

Corporate profits: -12.8%.

Corporate profits fell 12.8% in the first six months, public earnings by 28.5%, public corporations by 13.7%, foreign corporations (including those with Hong Kong and Macao capital) by 8.8% and private corporations by 8.4%.

June: improvement

June offers better prospects.
1. Sales of large industrial companies in June have recovered. Industrial value, after a 0.4% increase in May, rose by 4.8% in June.2. After the fall at the beginning of 2020, the Producer Price Index (PPI) is recovering, see illustration. 3. Cost prices are lower, thanks in part to the decline in the price of a barrel of oil. Out of 100 yuan, the fall in costs is equivalent to 0.22 yuan.
Producer Price Index (PPI) :

No rebound?

Wang Jian, an economic journalist, does not believe in China’s economic recovery, as the June data would indicate. Consumption is weak and foreign markets are not allowing the export sector to recover. How can we have an economy that is recovering? He doesn’t have confidence in some of the official figures. For example, in recent years, in 2018, customs started to use Chinese currency and not the dollar to indicate the amounts of foreign trade. It is more difficult to cross-check with data from other countries because of the exchange rate effect, which can be influenced in any direction. He noted other data that are little looked at and do not go through “harmonization”, such as transport figures. The first half of 2020 has a volume representing only 45.2% of the amount of 2019, and the month of June that would see a recovery records a volume of 68.8% of June 2019 within cities and 56.3% between cities. The journalist believes that it is far too early to talk about recovery. Many sectors had peaked in the years 2016-2017 before declining, the health crisis has only aggravated an economy in need of structural reforms.

Catastrophism without catastrophe

The economic and financial disaster on China has been going on for more than thirty years and no collisions have occurred. That the official figures are oriented for a beautiful aesthetic, I believe. For that, should we think that the situation is as bad as some circles say? No, that is not my opinion. No country is perfect. China is multifaceted. We have a China of cities and the eastern facade, with certain sectors – the digital – in shape. Chinese stimulus packages are there.
On the other hand, we have a China lagging with its 600 million people and their 1,000 yuan ($140) average monthly income. The Chinese economy is recovering? It certainly is! In small steps? There’s a good chance!

National Bureau of Statistics.
Bureau of Statistics 2
Wang Jian Program

29 July 2020

Who are those 600 million low-income Chinese?

Prime Minister Li Keqiang’s remarks about the 600 million Chinese with an average income of 1000 yuan ($140) have provoked many reactions and questions in the Chinese media, “Where are these 600 million? How can such an economic powerhouse end up with more than 40% of the population with such an income? The GDP per capita exceeds 10,000 USD, where does the money go? ». It’s true that the official media are more focused on the benefits of growth and that it’s easy to forget a reality that we don’t see much of in the big cities. Hence the shock of reality!

To identify the problem, one must turn to the China Institute for Income Distribution at Peking Normal University (中国收入分配研究院). First of all, it should be pointed out that this is net income after the deduction of possible social security contributions and taxes. What do we find out?
Of the 600 million Chinese with incomes below 1090 yuan, 75.6% come from rural areas, 36.2% from the centre, and 34.8% from the west. Not surprisingly, we had already mentioned here the inequalities between the urban and rural worlds and the eastern facade with the rest of the country.
19.8% are single. The average age is 38.5 years.
The average length of schooling is 9.5 years; their level of education is low. 9.6% are illiterate.
37.5% are not part of the labour force (term employé非劳动力, i.e., pensioners and those not of working age), 18% are sole proprietors, and 37.4% are employees.
5.6 million have no income.
Two hundred twenty million have less than 500 yuan, 420 million have less than 800 and 550 million have less than 1000.
Between 1090 and 2000 yuan, there are 364 million people. Only 700,000 people earn more than 20,000 yuan per month or 0.05% of the population. The following table gives details of the monthly income

low income in China.

Distribution of monthly income in China in 2019, source Caixin

Of course, when we look at these numbers, we have to put them in context. For example, GDP per capita of $10,000 is well below the estimated GDP at purchasing power parity of $16,000. But it is clear that a couple with 2,000 yuan in a big city has difficulty finding housing in Beijing or Shanghai, for example. Moreover, the largest cities are experiencing the same phenomenon as the world’s major capitals, with low income earners having to live on the outskirts even if it means putting in hours of transport every day to get to work.

Bas salaires en Chine

Li Keqiang is the Prime Minister; he is “on deck” and has to find solutions. Even if his speech sometimes aims to “stand out” from his president, he approaches certain subjects more realistically. He spoke out against some local officials who should not hide the figures on the epidemic, and this time he does not want to hide the dangers of the consequences of the outbreak, the most disadvantaged will be the most affected.

Related article :
600 million Chinese at 140 USD/month

Article and broadcast sources :

27 July 2020